Ellah Lakes Prepares for Palm Oil Boom in 2025
Detailed Breakdown of the News:
1️⃣ Palm Oil Production Set to Begin
• Target Timeline: First half of 2025 (Q1–Q2).
• Managing Director, Chuka Mordi, shared that the company’s oil milling facility is nearly complete, with commissioning expected by January-February 2025.
• Production will kick off with selling palm kernels, followed by the establishment of a palm kernel oil mill.
2️⃣ Financial Revitalization Efforts
• The milling operation marks a strategic move to boost revenue after two years of minimal activity, including one year with no income.
• Piggery Revenue: Currently, the company has 500 pigs, and plans are underway to scale up this operation.
• Revenue for the financial year ending July 2024 was ₦780,000, while the company posted a net loss of ₦893.9 million.
3️⃣ Debt Restructuring
• Shareholders voted to:
• Change the financial reporting cycle to January–December.
• Begin converting liabilities (₦2.7 billion) into equity.
• The CBN loan through FCMB has been reduced from ₦940 million to ₦658 million, with plans to tackle the remaining liabilities.
4️⃣ Challenges and Expansion Plans
• Ondo State Operations: Delays in commencing activities on 5,000 leased hectares for maize, cassava, and soybeans due to revised contract clauses.
• Since acquiring Telluria Farms (2,400-hectare plantation in Edo State) in 2019, the company has pivoted to focus on oil palm production. However, the paid-for three-ton mill from 2022 is still pending full operation.
Why This is Significant: Ellah Lakes’ pivot towards palm oil and palm kernel oil production represents a strategic step toward revitalizing its revenue streams and ensuring long-term sustainability in Nigeria’s agricultural sector.
Discussion Prompt:
How can Nigerian agribusinesses overcome operational delays and maximize their revenue potential? Let’s share insights!
Detailed Breakdown of the News:
1️⃣ Palm Oil Production Set to Begin
• Target Timeline: First half of 2025 (Q1–Q2).
• Managing Director, Chuka Mordi, shared that the company’s oil milling facility is nearly complete, with commissioning expected by January-February 2025.
• Production will kick off with selling palm kernels, followed by the establishment of a palm kernel oil mill.
2️⃣ Financial Revitalization Efforts
• The milling operation marks a strategic move to boost revenue after two years of minimal activity, including one year with no income.
• Piggery Revenue: Currently, the company has 500 pigs, and plans are underway to scale up this operation.
• Revenue for the financial year ending July 2024 was ₦780,000, while the company posted a net loss of ₦893.9 million.
3️⃣ Debt Restructuring
• Shareholders voted to:
• Change the financial reporting cycle to January–December.
• Begin converting liabilities (₦2.7 billion) into equity.
• The CBN loan through FCMB has been reduced from ₦940 million to ₦658 million, with plans to tackle the remaining liabilities.
4️⃣ Challenges and Expansion Plans
• Ondo State Operations: Delays in commencing activities on 5,000 leased hectares for maize, cassava, and soybeans due to revised contract clauses.
• Since acquiring Telluria Farms (2,400-hectare plantation in Edo State) in 2019, the company has pivoted to focus on oil palm production. However, the paid-for three-ton mill from 2022 is still pending full operation.
Why This is Significant: Ellah Lakes’ pivot towards palm oil and palm kernel oil production represents a strategic step toward revitalizing its revenue streams and ensuring long-term sustainability in Nigeria’s agricultural sector.
Discussion Prompt:
How can Nigerian agribusinesses overcome operational delays and maximize their revenue potential? Let’s share insights!